2) Effective planning of variable overhead costs means that a company performs those variable overhead costs that primarily ________.A) increase the planned variable overhead budgetsB) add value for the customer using the products or services C) increase the linearity between total costs and volume of productionD) identify the product advertising requirements

3) Which of the following statements is true of variable overhead costs?A) All the decisions determining the level of variable overhead costs are made at the start of a budget period.B) Planning of variable overhead costs includes choosing the appropriate level of capacity.C) Activities which add value are of least relevance while planning variable overhead costs. D) The level of variable overhead costs incurred in a period is mainly determined by day-to-day operating decisions.

7) Most of the decisions determining the level of fixed overhead costs to be incurred will be made ________.A) by the end of a budget periodB) by the middle of a budget periodC) on a day-to-day ongoing basisD) at the start of a budget period

8) The major challenge when planning fixed overhead is ________. A) calculating total costs B) calculating the cost-allocation rate C) choosing the appropriate level of capacity D) choosing the appropriate planning period

9) An effective plan for variable overhead costs will eliminate activities that do not add value.10) At the start of the budget period, management will have made most decisions regarding the level of fixed overhead costs to be incurred. 11) The planning of fixed overhead costs differs from the planning of variable overhead costs in terms of timing.12) The planning of fixed overhead costs does not differ from the planning of variable overhead costs.